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Nearly four years ago, when Accion Venture Lab made its first investment, we set out to fill a seed-stage funding gap for innovative financial inclusion startups around the world. Venture Lab was a new initiative of Accion, our parent organization that has worked for 50 years to build a financially inclusive world. We believed then (as we do now) that those startups could play a significant role in leveraging technology to improve the quality of and access to financial services for the underserved. Since then, Venture Lab has invested in 24 startups worldwide. We’ve built a diverse portfolio of companies covering a range of services — including credit, payments, savings, and insurance — that are sold both directly to consumers and small businesses, and to existing financial institutions to increase their reach and efficiency.

Back then — even four years ago — the world was a different place. Online SME lenders and marketplace lending platforms were scaling in the United States, but activity in emerging markets remained limited. “Big data” played a smaller role in mainstream conversations about financial inclusion. Smartphone penetration in Africa, Asia, and Latin America was still nascent, and little work was being done to explore how these devices could serve as delivery channels for financial services to the underbanked.

Of course, the landscape has now changed. There are a number of technology-enabled lenders in which we’ve invested — Konfio in Mexico, Kopo Kopo in Kenya — that are helping small and medium enterprises (SMEs) access working capital quickly and affordably. Companies that employ credit analytics, like DemystData, First Access, RevolutionCredit, and Aire, are finding innovative ways to work with new and existing data to help financial institutions make better credit decisions on customers with little to no traditional credit history. Finally, smartphone penetration is expanding quickly around the world with 6.1 billion users expected globally by 2020. A number of financial technology, or fintech, startups are leveraging that reach and data to provide access to credit in emerging markets like Kenya.

With such a wide range of opportunities to capitalize on these digital trends, there is no single future for fintech. We at Venture Lab work in many different markets, each with its own complexities around client needs, regulatory environments, and banking practices. But given recent technological changes, we’ve taken a step back as a team to reassess what the next five years may look like for our space. We came away with seven current trends that will be key to the future of fintech and financial inclusion:

The increasing importance of a meaningful and delightful customer experience.

We believe customer experience is going to become a key differentiator for fintech startups focused on the underserved, particularly in a more connected world with an increased number of choices. Startups can succeed on this front by designing sleek, simple financial products that customers actually enjoy using. For example, savings circles are an age-old informal financial tool used by communities around the world. We see a lot of power from these ubiquitous financial instruments; however, there are a number of bottlenecks to making them more transparent and easy to participate in. Digitized savings circles hold promise of both recreating and simplifying this tool using mobile phones and social networks, especially to reach younger and more tech-savvy customers. More broadly, we believe that successful fintech startups will focus on the customer experience not only as a way to differentiate from competition in the market but also as a response to the increasing demand from their customers.

Innovative ways to ‘social’-ize financial products and services.

While finance is still seen as a personal matter by many people, we’ve also seen now how some want to engage in a social way around their money (case in point, the rise of Venmo as well as peer-to-peer funding sites like Kickstarter or Prosper). We’re interested to see how this trend translates to emerging markets. In some ways, it isn’t a new concept at all — microfinance institutions have been using group lending models for decades and, as mentioned above, savings circles have been a common means of accessing capital around the world. But how will new digital tools and technology help move that social engagement forward?

Engagement as a two-way street between financial institutions and their customers.

In addition to creating delightful and social experiences for customers, we believe financial institutions — both fintech startups and existing providers — will need to create opportunities for two-way dialogues with their customers. This creates a way for providers to get to know and increase loyalty among their existing customers as well as for newly banked customers to build their financial capabilities. There have been exciting innovations in this space already; Juntos, for example, provides financial service providers with a mobile-based conversation platform that engages customers with content via SMS to build both trust and financial capabilities). We’re also keen to explore new innovations for how financial service providers can engage with customers (chatbots, virtual reality, to name a few trends).

The shift away from only increasing financial access and toward improving financial health.

Discussions in the financial inclusion community are moving away from financial inclusion as an end-goal in itself, and toward what it means to be financially healthy and truly engaged with a comprehensive suite of financial products and services. What does that mean for what we’ll see in fintech? New product offerings may, for example, help individuals build financial capabilities in new and interesting ways or manage their existing debt better (our portfolio company, CreditMantri in India, is doing that today by serving as a credit coach to help consumers improve their credit scores; Digit provides an automated savings tool that uses an intelligent algorithm to identify small amounts of money based on spending and income patterns).

An increasing emphasis on partnerships with financial (and non-financial players) for scale.

Much of fintech’s rise has been driven by a belief in the “unbundling of banks”– that startups can take on banks by leveraging technology to more effectively and efficiently offer specific products or services. As Robert Schiff and Venture Lab’s Paul Breloff identify, we’re now seeing fintech startups look to build partnerships with large institutions to achieve scale, whether that is with larger financial service providers, telecom companies, or even tech companies like Facebook, Whatsapp, or Uber. In turn, partnerships may be the way existing financial institutions learn from startups and continue to stay relevant as the fintech landscape evolves (for example, J.P. Morgan’s partnership with OnDeck). We have already seen many mainstream banks channel the energy and creativity of startups through in-house venture funds, incubators, increased M&A, and new ways of building fintech products themselves.

Using Blockchain technology in ways that go beyond use of cryptocurrencies.

We will explore new opportunities in utilizing blockchain technology to serve the underbanked — whether that is to optimize internal processes, make and verify transactions, or to improve data management and security practices. Some potential examples include providing an easier way to maintain land rights data which can then serve as collateral for accessing credit (see the work Bitland is doing in Ghana) or verifying identities which is often a challenging and prohibitive requirement for accessing both financial and non-financial services (see Banqu’s solutions in a number of different and challenging geographies).

Continued experimentation around creating and using alternative data to advance financial inclusion.

We continue to be excited about the new ways companies are leveraging data to personalize financial services for the underbanked. For example, there has already been a great deal done using data — e.g., telecom data, utility payments, government records, small business transactions — for real-time, predictive credit scoring, but as recent studies have shown, there are limits to certain forms of data and the field is still learning what works and what doesn’t. We expect to see more work done on this front, and in particular, on how data analytics companies could create or access new forms of behavioral data. For example, can leveraging Uber ratings or e-commerce reviews provide a new level of insight into a consumer or business owner?

These trends represent just a few of the areas we’re excited to see develop in the coming months and years. Overall, we’re seeing incredible opportunities to leverage technology to meet the financial needs of the underbanked around the world. What other trends do you think should be added to this list?